CVS revenues gained in the third quarter, but retail comps slipped, impacted by softer store traffic.
Net revenues were $46.18 billion in the third quarter ended September 30 versus $44.62 billion, while operating profit was $2.5 billion versus $2.82 billion in the quarter in the fiscal year prior.
In the quarter, revenues in the retail/LTC segment decreased 2.7% to $19.59 billion year over year with comparable store sales slipping 3.2%. Pharmacy comps decreased 3.4% while front-store comps, including general merchandise such as home goods, declined 2.8%. The decline in front store comps resulted from weaker customer traffic and efforts to rationalize promotional strategies, partially offset by an increase in basket size, according to CVS.
For the third quarter, CVS posted net income of $1.29 billion, or diluted earnings per share of $1.26, versus net income of $1.54 billion, or diluted earnings per share of $1.43, in the previous third quarter.
Adjusted net income from continuing operations was $1.53 billion versus $1.75 billion while adjusted earnings per diluted share were $1.50 versus $1.64 in the quarter the fiscal year before. Adjusted net income from continuing operations per diluted share beat a MarketBeat published analyst average estimate by a penny.
“The solid third quarter results we posted today keep us well on track to achieve our full-year targets,” said Larry Merlo, president and CEO, CVS. “While operating profit in the retail/LTC segment was impacted by the devastating hurricanes, operating profit in the pharmacy services segment was in line with expectations. At the same time, we continued to deliver substantial free cash flow and return significant value to our shareholders through dividends and share repurchases.”